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An expert on gangs and threat assessments has testified in the trial of four men accused of being members of the Lake Boyz gang in Fort Myers, Florida.

The Arrest

The four men who are currently on trial are James Brown, 23, Kwameaine Brown, 25, Diante Davis, 21, and Eric Fletcher, 30. The men were arrested in January 2017, following a two-year investigation by the Fort Myers Police Department and the State Attorney’s Office into the activities of the Lake Boyz gang. The police allege that the Lake Boyz gang operates in the Harlem Lakes subdivision of Fort Myers.

Brown, Brown, and Davis were arrested during a roundup. Fletcher was charged while serving a 30-year prison sentence for robbery. They are the first of 23 men who are scheduled to face a jury for their alleged involvement with the Lake Boyz. When the arrests took place, Fort Myers Police Chief Derrick Diggs said that “This group has targeted the Harlem Lakes community for years… We hope this initiative will give the Harlem Lakes community some peace.”

Florida State Attorney Steve Russell charged all of the alleged Lake Boyz members under Florida’s RICO Act (Racketeer Influenced and Corrupt Organizations Act). The Florida RICO Act is the state version of a federal law that was enacted to provide for extended criminal penalties and civil causes of action for acts that were performed as part of an ongoing criminal enterprise.

State’s Expert Witnesses

The state retained Ben Pieper, a senior investigator for the Bradenton Police Department’s gang unit, to testify as an expert on gangs. Pieper is also the co-owner and instructor for a consulting group that specializes in threat and gang assessments, All is One International. Pieper provided testimony about the history of gangs and how they work. Pieper testified about the gangs of New York, the Bloods and the Crips, and the lower hybrid gangs, that have “morphed into local neighborhood groups.” How the Bloods and the Crips are relevant to a Florida motorcycle gang is unclear.

Attorneys for the defendants objected repeatedly to Pieper’s testimony. The four defense attorneys used their cross-examination to show that Pieper did not know anything about this case or the Lake Boyz. Under cross-examination, Pieper revealed that he had been paid $8,000 for his involvement in the trial, but he had not looked at or read any of the discovery in the case. Davis’ attorney, K.J. Myllynen said, “So, after $8,000-plus dollars spent by this county you have no testimony to tell us about the defendants in this case.” Pieper replied, “Yes, sir, correct.”

One of the prosecutors, Bob Lee, explained that the state’s attorney’s office did not ask Pieper to review the case because that would be handled by the local detectives. Fort Myers police Detective Wolfgang Daniel was the lead investigator on the case and testified about the different ways that the police identified the gang members. Daniels testified that “a documented reliable informant” named James Brown, Kwameaine Brown, and Diante Davis as gang members and that Fletcher was seen in the company of other gang members, using gang signs. How hearsay testimony from a non-testifying, unidentified informant is admissible is again unclear. Daniels also explained about the police department’s use of social media, surveillance, and confidential informants to investigate the Lake Boyz.

Verdict

A jury found all four defendants Not Guilty. The verdict should be a reminder that calling an expert as a witness will backfire when the expert knows nothing about the relevant facts of the case. Lawyers should always choose their experts wisely.

Several members of women’s tennis and skiing teams at Minnesota’s St. Cloud State University began a class action lawsuit, alleging that the University’s decision to eliminate those sports violated Title IX’s prohibition against sex discrimination in educational institutions. The University moved to exclude the expert testimony from Dr. Donna Lopiano on behalf of the plaintiffs. The court’s ruling limited Dr. Lopiano’s testimony on legal issues while permitting her to express non-legal expert opinions.

The plaintiffs contend that the plan ignored Title IX’s demand that male and female students be given equal athletic opportunities. They contend that the plan worsens an existing disparity between opportunities offered to male and female student athletes. To achieve equality, the plaintiffs contend that the University has two choices: it can further reduce the availability of athletic participation to male students or increase athletic opportunities for female students.

The University argues that it would lose its Division I NCAA membership if it equalized athletic opportunities by reducing opportunities for male students. The University’s male and female ice hockey teams compete at a Division I level. The University also argues that it lacks the funds to equalize opportunities by increasing the number of athletic programs available to women.

The court entered a preliminary injunction enjoining the University from eliminating its women’s tennis team. In granting that injunction, the court determined that the lawsuit had substantial merit and that the plaintiffs are likely to prevail.

Expert Testimony Regarding Legal Standards

The plaintiffs seek to support their claims with the expert testimony of Dr. Donna Lopiano. Dr. Lopiano has a Ph.D. in physical education, operates a company that helps educational institutions solve challenges in their athletic programs, and has served as a gender equity consultant for the Office of Civil Rights in the former Department of Health, Education, and Welfare. The University objected to her proposed testimony.

The court agreed that Dr. Lopiano cannot testify about the legal requirements imposed by Title IX and cannot opine whether the University met those requirements. The court held that “Dr. Lopiano may not testify regarding the requirements of law because it would give the jury the appearance that the Court is shifting to Dr. Lopiano the responsibility to decide the case.” Explaining the law is the judge’s job, not the expert’s.

Notwithstanding the federal rule that an expert opinion “is not objectionable just because it embraces an ultimate issue,” the court followed the Eighth Circuit’s holding that an expert cannot opine “whether federal law was contravened.” Dr. Lopiano was accordingly prohibited from testifying about the requirements of Title IX or whether SCSU has complied with those requirements.

Expert Testimony About Practices that Avoid Discrimination

On the other hand, the court permitted Dr. Lopiano to testify about the history and purposes of Title IX and about the steps other educational institutions have taken to comply with its mandates. While Dr. Lopiano must walk a fine line by explaining how institutions comply with the law without explaining the law, the court concluded that her testimony about educational practices, which is largely statistical in nature, represents a non-legal (and therefore admissible) expert opinion.

The court also agreed that Dr. Lopiano can testify about the University’s history of responding, or failing to respond, to the interests and abilities of female student-athletes (for example, by failing to add women’s sports that students had informally requested). She can also testify about the underrepresentation of female student athletes and the University’s longstanding failure to address underrepresentation by expanding athletic opportunities for women.

Expert Testimony About Financial Aid

Title IX regulations prohibit sex discrimination in financial aid awards, including those that are athletic-based. The regulations require universities to make a mathematical calculation about the financial aid awarded to male and female students and to eliminate disparities that are not explained by legitimate, nondiscriminatory factors.

The University moved to exclude Dr. Lopiano’s testimony about the mathematical calculation because she is not a mathematician. Alternatively, the University asked for her testimony to be excluded because the calculation is so simple that it requires no expert testimony.

The court, however, determined that Dr. Lopiano’s proposed testimony goes beyond the calculation by discussing the legitimate, nondiscriminatory factors that may or may not explain disparities in the allocation of athletic-based financial aid. As part of that testimony, she can discuss an admittedly simple calculation because all experts are entitled to testify about “basic math” that involves “simple deductive reasoning,” particularly when they have experience making such calculations.

Expert Testimony About Gender Equity in Athletic Benefits

To decide whether an educational institution is providing equal benefits and opportunities to student athletes of both sexes, the Office of Civil Rights examines a laundry list of factors that might differentiate the treatment of male and female students. Dr. Lopiano proposed to undertake that examination to demonstrate that the University failed to provide equal benefits to student-athletes of different sexes.

Dr. Lopiano based her opinions on interviews with a former Director of Athletics and a former Associate Director of Athletics, both of whom recently retired. For example, she asked them to rate facilities as “Superior, Adequate, or Inadequate.” She then compared the number of male students to the number of female students who were given Superior facilities, and so on. She did not independently verify those ratings.

The University objected that Dr. Lopiano based her opinions on hearsay, but experts are entitled to base opinions on inadmissible hearsay of a type reasonably relied upon by experts in a particular field. Dr. Lopiano was following a method she derived from the Athletic Director’s Desk Reference and that she routinely used in her private consulting practice. The court was satisfied that she relied on the kind of data that experts in her field would routinely use to form opinions about gender equity in athletic programs.

The hearsay opinions of the former employees, however, did not address current conditions at the University. The court therefore barred Dr. Lopiano from presenting those opinions to the jury, while allowing her to testify about her conclusion that the University did not provide equal benefits to student-athletes of different sexes under the “laundry list.”

A clinical psychiatrist has testified that the behavior of a teen on trial for vandalizing a school with ISIS-themed graffiti and an attempted bombing is not consistent with his autism diagnosis.

The Vandalism and Attempted Bombing Incidents

On February 15, 2018, a Hurricane High School in St. George, Utah was vandalized with pro-Islamic Style Graffiti reading “ISIS is comi-.” The school’s U.S. flag was replaced with an ISIS flag.

A few weeks later, on March 5, an improvised bomb was left in the lunchroom of the nearby Pine View High School. The principal identified one 16-year-old student as a potential suspect.

The Investigation

Detective Brandon Dunbar, a police officer who responded to the Pine Valley High School, interviewed the suspect. During the interview, the teen admitted that he was responsible for the improvised incendiary device and for the vandalism incident that had occurred at Hurricane High School in February.

The teen told the interviewers that he had brought a backpack to school with matches, a can, canning lids, pellets, bottles of gasoline, and other items. He also admitted to striking the match. The teen said that he had intended “to cause some fear” in people and that he had been planning to bring the backpack to school for several weeks.

The teen said that he thought “it was pretty cool” to see the bomb squad arrive. He said, “I’ve been looking at ISIS stuff, so I wanted to see what would happen and what people would think.” He continued, “I don’t see death as anything bad. I see it as a new way of life… I expected the thing to go off.”

Because the police viewed the backpack as a weapon of mass destruction, the FBI was called in to investigate. Special Agent Chris Anderson said that the teenager’s laptop and cell phone were taken by the FBI for review. The teen’s phone showed that he had searched terms like “bomb,” “fuse,” “ISIS,” and “How do westerners become recruited to ISIS.”

Autism Diagnosis Controversy

The teen has been charged with felony counts of attempted murder and use of a weapon of mass destruction and misdemeanor counts of graffiti and abuse of a flag. he teen is currently in proceedings to determine whether he should be tried as a juvenile or as an adult.

A forensic psychologist who interviewed the teen testified that he had diagnosed him with level 1 autism spectrum disorder and that he had below-average IQ and difficulty associating with others.

The state brought in Gregory Saatoff, a high-profile clinical psychiatrist and a longtime consultant with the FBI to challenge that diagnosis. Saatoff testified that the autism diagnosis and perceived intellectual limitations don’t make sense given the crimes that he had been charged with. Saatoff said that the crimes would require meticulous planning and duplicitous behavior. Saatoff said that he also noted that the boy’s generally good grades, strong family support system, and lack of problems did not fit in with the diagnosis.

Saatoff said that none of the teen’s actions matched the general tendencies of someone with autism spectrum disorder. He noted that the boy’s internet history and responses to interviews suggested that he was very cognizant of the way that the initial incident had been received and that he was trying to “leverage” the attention around the school shooting in Parkland, Florida to create fear in the second incident.

The judge has given no indication of when he will rule on the request to try the student as an adult.

The Rhode Island Supreme Court has thrown out a $5.7 million jury trial award for the agency that runs the Central Landfill in Johnston for a lack of supporting expert witness testimony.

The Dispute

In 2007, Michael OConnell became the Executive Director of the Rhode Island Resource Recovery Corporation. He soon found that its accounting firm, Restivo Monacelli L.L.P., had missed numerous issues in its audits. He testified, “I came in in six months and I was tripping over issues; I couldn’t help it, they were everywhere…. And they found nothing.”

One problem was that Resource Recovery trusts were invested in violation of agency policies. OConnell found out that one of the landfill’s commissioners was also serving as a paid board member of the company that managed its trusts.

OConnell let the governor know about the problems he had found and a full forensic audit was conducted. The audit revealed that the agency’s employees, vendors, and commissioners had been compromising their ethical obligations to the agency and the public.

The Trial

The Rhode Island Resource Recovery Corporation sued Restivo Monacelli L.L.P for professional malpractice, breach of contract, civil conspiracy, aiding and abetting breaches of fiduciary duty by Resource Recovery commissioners, managers, and employees, and knowingly submitting false, erroneous, or incomplete documents or statements to public officials with the intent of misleading the state. It claimed that the accounting firm it had hired to watch its books failed to identify issues such as:

$10,000 annually for golf junkets,

improper charitable contributions,

overpaying for real estate, and

major trust fund losses.

Restivo disputed the claims of negligence and malpractice and said that the damages were primarily caused by the agency itself. Edmund Restivo, a managing partner in Restivo, said, “We prepared our audit according to generally accepted auditing standards and the corporation signed off on our auditing report at the end of the audit and took responsibility for it… .We do very good work and stand by our record as to what we do.”

At trial, a jury awarded Rhode Island Resource Recovery Corporation $5.7 million. Restivo appealed the award to the Rhode Island Supreme Court. On appeal, the court focused on causation, or whether or not the malpractice claimed in the lawsuit led to the awarded damages. Resource Recovery argued that it didn’t need an expert to explain how Restivo’s malpractice hurt them financially. Resource Recovery argued that a jury could have found that if Restivo did its job, Resource Recovery’s bad actors would have stopped sooner. The court ultimately ruled that Resource Recovery should have provided expert testimony to show how any accounting malpractice by Restivo actually caused the agency to lose money.

Lauren Jones, an attorney for Restivo, said that her client was pleased with the outcome. She said, “We had high hopes it would turn out this way…. We’re glad the court saw it as we thought it should be seen.”

The Louisiana Supreme Court has ordered a new trial for a woman who was sentenced to life in prison for murder of her husband.

Renaldo Curley’s Death

In March 2005, Catina Curley shot and killed her husband of 10 years, Renaldo Curley, at their home in New Orleans. Curley told police that she had been trying to flee her house during an argument because she feared her husband would beat her. Curley told authorities that she grabbed a revolver and it went off accidentally as she was pointing it at the ground. Curley said that the bullet ricocheted into her husband’s chest.

Curley was charged with second-degree murder in connection with the shooting. Curley’s original attorney, Lon Burns, had her plead not guilty at her arraignment on August 9, 2005. Ten days later, Burns had the plea withdrawn and entered a new plea of not guilty by reason of insanity. Attorney John Fuller replaced Burns as Curley’s attorney in September 2006. On February 26, 2007, Fuller made a motion to drop the insanity plea.

At trial, two of Curley’s children testified that they had lost count of the number of times that they had seen Renaldo beat their mother. Curley’s boss also testified about how frequently Curley would call in sick after her husband had beaten her. A coroner’s expert testified that the gun was pointed straight at Renaldo’s chest when it went off. Curley’s attorney never called an expert on battered women syndrome to testify at trial. Curley was found guilty on a 11-1 vote and sentenced to life in prison for the murder of her husband.

Reversed Conviction

Orleans Parish Criminal District Court Judge Arthur Hunter overturned the verdict against Curley the same month that she was convicted, but the 4th Circuit Court of Appeal later reversed him. Curley retained new counsel for her appeal to the Louisiana Supreme Court.

Curley’s new attorneys, Paul Barker and Christen DeNicholas argued, “What goes through a domestic violence victim’s head when faced with recurring acts of violence is not necessarily what would go through any of our own heads when we are faced with one isolated incident… Retreat then becomes a very subjective aspect.”

At a post-conviction hearing, Fuller explained his reasoning for the decisions that he made when he defended Curley. He said, “At that point in my practice, the thinking was that we would just argue straight for a justifiable homicide (verdict), and we didn’t really take into account, relative to a not guilty by reason of insanity (plea), the opportunity to present a battered spouse expert.”

The Louisiana Supreme Court decided that Curley lacked effective assistance at trial, reversing her conviction and calling for a new trial. According to the Louisiana Supreme Court, Fuller mistakenly believed that he was barred from introducing expert testimony on battered women syndrome because Curley’s plea of not guilty by reason of insanity had been withdrawn. Fuller has since admitted that he should have called a battered spouse expert. He said, “I would say ignorance was one of the issues…, Obviously, I should have talked to or at least conferred with a battered spouse expert, but we didn’t do that.”

A police use of force expert has testified in the wrongful death suit against City of Chicago for the shooting death of Quintonio Legrier.

The Shooting

In December 2015, Quintonio LeGrier and Bettie Jones were shot and killed by Chicago Police Officer Robert Rialmo. Officers were responding to a domestic disturbance call from LeGrier’s father, who said that his son had a baseball bat in his hand.

Officer Rialmo told investigators that LeGrier was holding a bat above his head and coming at him when he fired at him. Rialmo said that he had been “in fear of his life.” Jones was shot accidentally. LeGrier was a 19-year-old college student and Jones was a 55-year-old tenant on LeGrier’s father’s property.

Investigation of Officer’s Conduct

Following an investigation, the Civilian Office of Police Accountability stated that the shooting was unjustified and recommended that Rialmo be fired. Chicago Police Superintendent Eddie Johnson disagreed with those findings and said that Rialmo’s actions were within department policy. One member of the police board agreed and the matter is currently pending before the full police board.

Wrongful Death Trial

The families of LeGrier and Jones sued the City of Chicago for their wrongful deaths. The estate of Bettie Jones settled with the city a few days before the start of the trial. The civil case brought by the estate of Quintonio LeGrier continued to trial.

The City of Chicago retained a police use of force expert, Emanuel Kapelsohn, to testify at trial. Kapelsohn has been an expert witness and consultant for thousands of cases. Kapelsohn told jurors that Officer Rialmo had no choice but to shoot Quintonio LeGrier and that a stun gun, pepper spray, or a baton would not have been the correct response to someone charging at an officer with an aluminum bat. Kapelsohn testified, “In my opinion, Officer Rialmo’s use of force is in keeping with and is consistent with standard police training…. The officer isn’t a mind reader…. The officer can’t afford to wait to see if the person swings the bat at his head.”

Kapelsohn said that he could determine where Rialmo was standing when he fired by figuring out where the casings would land. Kapelsohn test-fired Rialmo’s gun to see where the shell casings were ejected to and compared it to a photo that was taken after the shooting. The photo showed that three casings were found on the sidewalk, two were found on the grass between the sidewalk and the street, and one was found by the grass near the porch. An additional casing was found across the street. Kapelsohn said that the positions of the six casings found near the building were “inconsistent with the officer firing from the public sidewalk.”

Under cross-examination, Kapelsohn admitted that he has testified on numerous police use of force cases for the City in the past, earning a total of over $200,000. Kapelsohn also said that he reviewed some of the police witness statements but that he did not review the statement by Quintonio’s father, Antonio. Kapelsohn also stated that he has worked for several gun manufacturers and that he has not gotten academic training on shooting reconstruction.

Lipitor Multidistrict Litigation

Lipitor is a cholesterol drug manufactured by Pfizer. More than 3,000 women sued Pfizer, claiming that they developed diabetes as a result of taking Lipitor. The women claimed that Pfizer was negligent in its design and promotion of Lipitor and that it failed to warn against Lipitor’s known risks.

The lawsuits were transferred to the district of South Carolina for consolidated proceedings and four plaintiffs were chosen to serve as bellwether cases. The plaintiffs retained general causation experts to testify about the causal association between Lipitor and diabetes and specific causation experts to testify that Lipitor proximately caused the onset of diabetes for each of the bellwether patients. The plaintiffs also retained an expert biostatistician to testify that taking Lipitor led to a statistically increased risk in diabetes.

Exclusion of Experts

Pfizer moved to exclude the plaintiffs’ expert witnesses under Daubert and Federal Rule of Evidence 702. Following hearings and an opportunity for the experts to amend their reports, the lower court excluded testimony from three experts. The court’s rulings left plaintiffs without their bellwether cases and limited them to a small subset of patients who had taken an 80 mg dose. The district court issued show cause orders asking any plaintiff to submit evidence that would enable her to survive summary judgment. When no plaintiff was able to provide sufficient evidence, the district court granted summary judgment against all plaintiffs.

The plaintiffs appealed the lower court’s decision. A panel from the Fourth Circuit Court of Appeals reviewed the district court’s decision and found that the lower court did not abuse its discretion.

The district court ruled that statistician Dr. Nicholas Jewell’s methodology was too tainted with potential bias and error. The district court decided that Jewell was not qualified to make determinations about what data should have alerted Pfizer to a possible link between Lipitor and Type 2 diabetes. The district court took issue with Jewell’s choice to include in his report only the test results that supported the plaintiffs. The panel wrote, “The district court concluded (we think reasonably) that such an approach lacked the hallmark of science properly performed.”

The district court also excluded the testimony of Dr. Sonal Singh. Singh testified about the association between various dosages of Lipitor and diabetes. The district court found that Singh didn’t reliably apply the Bradford Hill criteria for causation to the data to determine if using Lipitor caused an increased risk in diabetes. The panel agreed with the district court, “where, as here, each plaintiff took one of only several commercially available doses, clinical data exist that enable an expert to perform a causation analysis at each dose, and experts (including plaintiffs’ own) acknowledge that there is some relationship between dosage and harm, the district court doesn’t abuse its discretion in asking the expert to produce a dose-by-dose analysis.”

The district court also excluded the testimony of Dr. Elizabeth Murphy. Murphy testified in a bellwether case that Lipitor specifically caused the patient’s diabetes. The district court found that Dr. Murphy had dismissed other possible causes of the patient’s diabetes in a “cursory” fashion. The panel concluded that the district court acted within its discretion in excluding Dr. Murphy’s testimony.

The Pennsylvania Supreme Court has ruled that when autopsy reports are used to substantiate cause of death in murder cases, the medical examiner who wrote that report must testify in court.

The Shooting

In December 2012, Darnell Brown attended a party in Philadelphia after hiding a revolver in a nearby parked car. At the party, Brown got into an argument with Cory Morton. Brown’s friend, Marcus Stokes, retrieved the gun and gave it to Brown, who shot Morton four times.

Dr. Marlon Osbourne of the Philadelphia Medical Examiner’s Office performed an autopsy on Morton and prepared a report of his findings. The autopsy report detailed four gunshot wounds that struck the victim’s ribs, heart, left lung and left shoulder. The report noted that three bullets entered the front of the victim’s body and one entered his back. The report concluded that the cause of death was multiple gunshot wounds and that the manner of death was homicide.

Case History

When Brown’s case went to trial, Dr. Osbourne was no longer employed by the Medical Examiner’s Office and he was not called as a witness. His autopsy report was entered into evidence. The Commonwealth called a different medical examiner who had not been present at the autopsy to provide expert testimony based on portions of the autopsy report and photos.

Defense counsel objected to the admission of the autopsy report and medical examiner’s testimony, arguing that the report was testimonial evidence and its admission violated the Confrontation Clause of the Sixth Amendment of the United States Constitution. The trial court overruled the objection and Brown was convicted of third-degree murder and related offenses. Brown was sentenced to 25 to 50 years in prison.

Brown appealed, arguing that it was an error to let another medical examiner testify about the cause and manner of the victim’s death based on Dr. Osbourne’s autopsy report.

Commonwealth v. Brown

The Pennsylvania Supreme Court agreed with Brown that the autopsy report was testimonial. In the majority opinion, Justice Kevin Dougherty wrote that “the law requires the coroner or medical examiner charged with conducting and reporting the results of such autopsies to consult and advise the local district attorney to the extent practicable. . . . Accordingly, we determine the primary purpose for preparation of an autopsy report under these circumstances is to establish or prove past events potentially relevant to a later criminal prosecution and that any person creating the report would reasonably believe it would be available for use at a later criminal trial. Thus, we conclude the autopsy report in this case was testimonial.”

However, the court ruled that Osbourne’s absence was harmless. The majority explained that the report was inadmissible and that the medical examiner who testified based his testimony on other factors. “Here Dr. Chu formed an independent conclusion and testified to that conclusion based on his own review of both the otherwise inadmissible facts and data contained in the report and the data provided by the autopsy photographs. . . . Because Dr. Chu properly formed an independent opinion, and was available to be cross-examined regarding the basis of that opinion, we conclude there was no confrontation clause violation with respect to his opinion regarding the cause of death. Additionally, Dr. Chu’s testimony was sufficient to satisfy the commonwealth’s evidentiary burden regarding the victim’s cause of death.”

In a recent decision, the U.S. Tax Court rejected a taxpayer’s attempt to use an expert witness to prove that the taxpayer’s computation of tax liability was proper. While an expert witness might play a role in tax litigation, the Tax Court ruled that an expert report, standing alone, cannot satisfy the taxpayer’s burden of proving that deductions were improperly disallowed by IRS auditors.

Facts of the Case

The IRS decided that certain taxpayers who owned shares of Total Health Concepts, LLC (“THC”) miscalculated their tax liability. THC is a Colorado company that sells medical marijuana. It elected to be treated as an S corporation, meaning profits and losses would be passed through to shareholders for tax reporting purposes.

THC reported business losses for tax years 2009 to 2011. The company calculated its income by subtracting cost of goods sold from receipts. It then claimed “below the line” deductions for wages, rent, depreciation, and other costs of doing business. The taxpayers then claimed THC’s pass-through losses on their individual income tax returns.

The IRS audited THC’s return and reclassified many of the claimed business expenses as “cost of goods sold.” It disallowed THC’s remaining “below the line” deductions. The adjustments increased THC’s taxable income and thus increased the taxable income of the taxpayers, who challenged the IRS determinations in Tax Court.

Expert Witness

When the IRS decides that a taxpayer has a greater tax liability than is reported on a tax return, it is the taxpayer’s burden to prove that the IRS is wrong. Taxpayers must usually meet that burden by producing records that substantiate the amounts and purpose of deductions that the IRS disallowed.

Instead of producing business records to substantiate THC’s deductions, the taxpayers submitted into evidence an expert report. The report was written by Jim Marty, a C.P.A. with expertise in cost accounting within the marijuana industry. The report discussed how THC should compute costs of goods sold and opined that its “below the line” deductions were proper.

The IRS moved to exclude the expert report. The IRS argued that the report consisted of legal opinions that usurped the role of the Tax Court judge. The IRS also argued that the taxpayers were not entitled to rely on an expert report as a substitute for business records that they failed to produce.

Tax Court Ruling

The Tax Court applied the federal Daubert standard to determine whether the report was admissible. It concluded that the report was “brief and summary” and that its content was unreliable. Some of its assertions of fact were unsupported by reference to any source of those facts. When the report did refer to a source, the source was not produced so that the accuracy of the assertions could be determined. In short, the report lacked “sufficient information or data” to support a conclusion that the opinions expressed were based on anything other than conjecture.

For example, the report made assumptions about the average wholesale purchase price of medical marijuana, but did not explain the basis for those assumptions. The report also assumed that the cost of goods sold equals 55% of gross sales, a figure that was apparently based on industry averages. The report also included “reconstructed” tax returns as exhibits that purported to show that THC had a higher cost of goods sold than the industry average in the relevant tax years. Supporting exhibits did not include any business records showing actual sales figures or any other supporting documentation.

The Tax Court noted that the expert report was not based on personal knowledge of the taxpayers’ business. The court held that a reconstructed tax return based on industry averages was not an adequate substitute for substantiation of actual business expenses.

Finally, the Tax Court agreed with the IRS that the report consisted primarily of the expert’s legal opinions as to the types of expenses that should be included in the cost of goods sold. The court held that legal conclusions are not a proper subject of expert testimony because the court, not the expert, determines the law. To be admissible, expert opinions must explain facts, not law.

A child abuse expert has offered testimony in the trial of a California man who is charged with beating his 6-week-old daughter to death.

The Death

On November 12, 2012, emergency responders reported to a Visalia home for reports of a baby who was not breathing. The 6-week old baby girl was covered in bruises and had fractured ribs and legs. Peyton Rowe was rushed to Kaweah Delta Medical Center. The doctors said that Peyton had to be resuscitated by paramedics on her way to the hospital. Peyton died at the hospital less than an hour later.

Peyton’s parents were arrested in connection with her death. Peyton’s mother, Courtney Rowe, pleaded guilty to felony child abuse with an allegation of willful harm or injury causing death. Peyton’s father, 28-year-old Aaron Rowe, was charged with murder and proceeded to trial. Rowe faces the death penalty if convicted.

The Trial

At trial, Rowe’s defense attorneys argued that Peyton’s death was an accident. Rowe claims that he slipped while holding his daughter. The Tulare County Prosecutor Brenda Broker told the jurors, “The evidence will prove that Peyton was anything but daddy’s little girl. . . . Peyton throughout her short life had been continuously physically abused, ultimately tortured, and then intentionally murdered by her father who was a man with a propensity for violence.”

The prosecution called Dr. Frederic Bruhn to testify as an expert on child abuse. Dr. Bruhn has seen more than 1,000 children who suffered from some form of abuse. In preparation for his testimony, Bruhn reviewed Peyton’s X-rays and her autopsy report. Peyton’s autopsy revealed that she died from blunt force trauma to the head and her X-rays showed both fresh fractures and old breaks.

Dr. Bruhn testified about the injuries that doctors found on Peyton when she arrived at the hospital. Bruhn labeled Peyton’s injuries “suspicious.” Bruhn said, “Her rib fractures led doctors at [Kaweah Delta Medical Center] to suspect abusive injuries.” Bruhn commented that the amount of fractures to Peyton’s ribs and back of rib cage are “rarely seen and highly correlates to abusive injuries in children. . . . The number [of fractured ribs] suggest abusive injury.”

Dr. Bruhn described bruising to Peyton’s cheek and ear as another “red flag.” Bruhn said, “Children as young as Peyton don’t do much. . . . If they don’t move they don’t bruise.” Bruhn said that facial bruises on children Peyton’s age are rarely accidental. Peyton’s left inner thigh was also bruised. According to Bruhn, the pattern of the bruises on Peyton’s body was consistent with fingers gripping.

Dr. Bruhn opined that Peyton suffered broken ribs as a result of shaking and squeezing around her chest and that the fractures to her leg and arm could not have been caused by a fall. He said, “You have the head injuries, you have the optic nerve injuries, you have the skeletal injuries, you have the bruising injuries. . . . Once you get to that amount of injuries, you can’t explain it all by one simple fall.”

The defense countered with medical experts who testified that Peyton may have suffered from a bone disease. They concluded that the evidence is consistent with Rowe’s statement that he fell with Peyton in his arms days, causing her death.